Developing Backward Areas Table 25.13: Revenues and Expenditure as% of the GRP of Provincial Governments, 2018-19 (% of GRP) Punjab Sindh Khyber­Pakhtunkhwa Balochistan Four Provinces Combined Total Revenues 6.3 6.6 10.0 13.8 7.2 Own Revenue 1.0 1.5 1.0 0.0 1.2 Federal Transfers 5.3 5.1 8.9 12.9 6.0 Total Expenditure 6.1 6.1 9.7 12.9 6.8 Current 5.0 5.2 7.3 10.7 5.6 Development 1.1 0.9 2.4 2.2 1.2 Cash Surplus/ Deficit 0.2 0.4 0.1 0.9 0.4 Source: Fiscal Operations, MOF The highest own revenue to GRP ratio is observed in the case of Sindh of 1.5 percent. As expected, the fiscal transfers from the Federal Government are the highest to Khyber­Pakhtunkhwa and Balochistan at 8.9 percent and 12.9 percent respectively of the GRPs. Consequently, the Expenditure-to-GDP ratios are also significantly higher for the two smaller Provincial Governments. It is closer to 6 percent of the GRP for Punjab and Sindh and rises to almost 10 percent of the GRP in the case of Khyber-Pakhtunkhwa and 13 percent of the GRP in Balochistan. Table 25.14 highlights the spending on health and education by the Provincial Governments as a percentage of their respective GDPs. In line with the overall level of spending, the expenditure is higher in Khyber-Pakhtunkhwa and Balochistan. Table 25.14: Expenditure on Education and Health as% of GRP by Province, 2018-19 (% of GRP) Education% of Health% of (Billion Rs) GRP(Billion Rs) GRP Total (% of GRP) Punjab 371.8 1.7 218.9 1.0 2.7 Sindh 162.0 1.3 98.1 0.8 2.1 Khyber-Pakhtunkhwa 152.7 3.1 55.7 1.1 4.2 Balochistan 55.3 2.9 21.9 1.1 4.0 Federal 125.6 0.3 27.1 0.1 0.4 Pakistan 867.4 2.1 421.7 1.0 3.1 Source: PRSP Progress Reports The fundamental question which arises is why with a higher level of spending there is a divergence in the performance of the two smaller Provinces? Why has Khyber-Pakhtunkhwa 257